Sanjay Rastogi, Lucknow V. ACIT, Lucknow

ITA 76/LKW/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 9141 (ITAT-LUCKNOW)
• Duration Of Justice: 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-03-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 07-03-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 11-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANADI VERMA
• Assessee Lawyers: J J MEHROTRA
• Keywords: Gift; Opportunity of being heard; Corroborative evidences

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SMC BENCH, LUCKNOW. BEFORE SHRI H.L.KARWA, HON'BLE VICE PRESIDENT I.T.A.NO.76(LKW.)/2011 A.Y. :2001-02 SANJAY RASTOGI, VS. THE ACIT, C.C. IV, 15-BAHORAN TOLA, CHOWK, LUCKNOW. LUCKNOW. PAN AAMPR1540A (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI J.J.MEHROTRA, C.A. RESPONDENT BY : SHRI ANADI VERMA, SR. D.R. O R D E R THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGA INST THE ORDER OF THE LD. CIT(A) III, LUCKNOW DATED 16.8.2010 RELATING T O THE ASSESSMENT YEAR 2001-02. 2. IN THIS APPEAL, THE ASSESSEE HAS RAISED THE FOL LOWING GROUNDS: THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) IS NOT JUSTIFIED IN CONFIRMING THE LOAN OF RS.30,00 0/- RECEIVED FROM MR. QMAR ABRID AS UNDISCLOSED INCOME IN THE HANDS O F THE APPELLANT. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) IS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF RS.3 5,000/- AND ENHANCING IT TO RS.35,500/- ON ACCOUNT OF LOAN TAKE N FROM SHRI V.S.KHURANA AS UNDISCLOSED INCOME IN THE HANDS OF THE APPELLANT. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) IS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF GIF T OF RS.25,000 RECEIVED FROM MR.ATUL KUMAR SINGH AS UNDISCLOSED I NCOME IN THE HANDS OF THE APPELLANT. 2 4. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD.CIT(A) IS NOT JUSTIFIED IN CONFIRMING THE ADDITION OF GIFT OF RS.20,000 RECEIVED FROM SHRI SHYMENDRA MEHROTRA AS UNDISCLOSED INCOME IN THE HANDS OF THE APPELLANT. 5. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR WITHDRAW ANY OR ALL THE GROUNDS OF APPEAL ON OR BE FORE THE DATE OF HEARING. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT D URING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAS STATED TAKEN LOANS FROM THE FOLLOWING PERSONS: (I) MR.QMAR ABRID RS.30,000 (II) MR.V.S.KHURANA RS.35,000 RS.65,000 3.1 APART FROM THE ABOVE LOANS, THE ASSESSEE ALSO C REDITED HIS CAPITAL ACCOUNT AND ACCOUNT OF HIS MINOR SON BY THE GIFTS R ECEIVED FROM THE FOLLOWING PERSONS: (I) MR.SHYMENDRA MEHROTRA IN THE NAME OF MASTER N AKUL RS.20,000 (II) MR.ATUL KUMAR SINGH RS.25,000 3.2 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, T HE AO ASKED THE ASSESSEE TO PRODUCE THE PERSONS, WHO HAD GIVEN LOAN S AND GIFTS FOR VERIFICATION. ACCORDING TO THE AO, THE ASSESSEE WAS NOT ABLE TO PRODUCE THESE PERSONS AND SOUGHT SEVERAL ADJOURNMENTS. THE AO OBSERVED THAT ON 22.3.2004, SHRI SHYMENDRA MEHROTRA, AN EMPLOYEE OF CENTRAL DRUG & RESEARCH INSTITUTE DRAWING SALARY OF RS.17,000 APPR OXIMATELY ATTENDED AND STATED THAT HE HAD GIVEN RS.30,000 BY CHEQUE TO SHR I SANJAY RASTOGI, THE ASSESSE. ANY OTHER GIFT MADE BY HIM WAS DENIED. THE LOAN CREDITORS AND 3 OTHER DONORS WERE NOT PRODUCED BEFORE THE AO. EVEN THE CONFIRMATIONS FILED DID NOT BEAR THE PAN OF THE LENDER SHRI QMAR ABRID AND SHRI ATUL KUMAR SINGH. THE AO ALSO OBSERVED THAT THE ASSESSEE WAS RECEIVING GIFTS IN ALL THE ASSESSMENT YEARS, BUT HE HAS NEVER GIFTED TO ANYON E. AS THE ONUS WHICH LAY ON THE ASSESEE TO PROVE THE GENUINENESS OF LOAN AND GIFT WAS NOT DISCHARGED AND AS OBSERVED BY THE AO, SIMPLY FILING LOAN/GIFT CONFIRMATIONS DOES NOT PROVE THE GENUINENESS OF TRANSACTION AS THE ASSESSE E HAS TO PROVE THE IDENTITY OF LENDER/DONOR, CREDITWORTHINESS OF LEND ER/DONOR AND FINALLY THE GENUINENESS OF TRANSACTION AND THE ASSESSEE ALSO FA ILED TO PRODUCE THE PERSONS FROM WHOM LOANS AND GIFT WAS RECEIVED, THE GENUINENESS OF LOAN AND GIFT TRANSACTIONS WAS NOT PROVED. THE AO HELD THAT THE ASSESSEE HAD INTRODUCED HIS OWN UNACCOUNTED MONEY IN THE FORM OF LOANS AND GIFTS. THEREFORE, THE LOAN OF RS.65,000 AND THE GIFT BY SH RI SHYMENDRA MEHROTRA TO MASTER NAKUL AMOUNTING TO RS.20,000 AND THE GIFT FROM SHRI ATUL KUMAR SINGH AMOUNTING TO RS.25,000 WERE ADDED TO THE INC OME OF THE ASSESSEE. 4. ON APPEAL, THE LD.CIT(A) CONFIRMED THE ORDER OF THE AO WITH REGARD TO THE ABOVE ADDITIONS. 5. I HAVE HEARD THE RIVAL SUBMISSIONS. SHRI J.J.MEH ROTRA, C.A.,LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT DUE TO CERTAIN REA SONS WHICH WERE BEYOND THE CONTROL OF THE ASSESSEE, THE ASSESSEE COULD NO T PRODUCE THE ABOVE PERSONS FOR EXAMINATION BEFORE THE AO. SHRI J.J.MEH ROTRA, LD. COUNSEL FOR THE ASSESSEE STATED THAT MR.QMAR ABRID HAD GONE T O DUBAI AND THEREFORE, IT WAS NOT POSSIBLE TO PRODUCE HIM. SIMILARLY, SHRI V .S.KHURANA WAS STATED TO BE A BANK EMPLOYEE, WHO HAD BEEN TRANSFERRED TO PU NJAB AND THEREFORE, IT WAS NOT POSSIBLE TO PRODUCE HIM. HE FURTHER SUBMITT ED THAT THE LD.CIT(A) HAS 4 ACCEPTED THE GIFT OF RS.30,000 GIVEN BY SHRI SHYME NDRA MEHROTRA, AN EMPLOYEE OF CENTRAL DRUG & RESEARCH INSTITUTE. HOWE VER, A GIFT OF RS.20,000 RECEIVED BY HIS SON HAS BEEN DISBELIEVED WITHOUT ANY COGENT REASON. ALTERNATIVELY, SHRI J.J.MEHROTRA, LD. COUN SEL FOR THE ASSESSEE SUBMITTED THAT THE ABOVE THREE PERSONS ARE AVAILAB LE AND THEREFORE, THE ASSESSEE UNDERTAKES TO PRODUCE THESE PERSONS BEFORE THE AO FOR EXAMINATION ALONGWITH SUPPORTING EVIDENCE. HE ,THEREFORE, SUBMI TTED THAT IN THE INTEREST OF JUSTICE AND FAIRPLAY A REASONABLE OPPORTUNITY FO R PRODUCING THE ABOVE PERSONS BEFORE THE AO MAY BE GIVEN. CONSIDERING TH E ENTIRE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE, I THINK IT PROPE R TO SET ASIDE THE ORDER OF THE LD.CIT(A) ON THE ABOVE ISSUE AND REMAND THE MAT TER TO THE FILE OF THE AO WITH A DIRECTION TO DECIDE THE ISSUE AFRESH IN ACCO RDANCE WITH LAW AFTER EXAMINING THE ABOVE PERSONS, IF THE ASSESSEE IS ABL E TO PRODUCE THEM BEFORE HIM. IN CASE OF FAILURE ON THE PART OF THE ASSESSEE TO PRODUCE THE ABOVE PERSONS, THE AO WILL BE FREE TO TAKE ADVERSE VIEW IN THE MATTER. THE AO SHOULD GIVE AN OPPORTUNITY OF BEING HEARD TO THE AS SESSEE IN THE MATTER. 6. FOR STATISTICAL PURPOSES, THE APPEAL IS ALLOWED. THE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 7. 3.2011. SD. (H.L.KARWA) VICE PRESIDENT MARCH 7TH ,2011. COPY TO THE : 1. APPELLANT 2. RESPONDENT 3. CIT(A) (4) CIT 5.DR. A.R.,ITAT, LUCKNOW. SRIVASTAVA.